Motorola Inc. is betting consumers will pay to have it both ways,
gaining control over the content on their car radios and the
flexibility of taking their music with them on their cell phones when
they turn off their engines.

Motorola, the No. 2 maker of mobile telephones, is set to unveil a
service called iRadio that will let users download preselected audio
content from a range of providers on their home computers, dump it on
their cell phones and listen to it on their car stereos.

The company is banking on the popularity of portable music underscored
by sales of Apple Computer Inc.'s iPod digital music players and
growing demand for high-quality, commercial-free radio provided by
satellite radio companies Sirius Satellite Radio Inc. and XM
Satellite Radio Holdings Inc.

"What we set out to solve was finding a way to get the breadth of
content into the stereo where people listen," said David Ulmer,
director of marketing for Motorola's media solutions business. "We
looked around and noticed that everyone had a cell phone in their
pocket. There is a very large market of potential customers to go
after."

The iRadio service, which will let customers download 10 hours of
content at a time, will be available at the subscription cost of about
$5 to $7 a month. When not driving, customers can listen to content on
a phone with a headset.

By comparison, Sirius and XM charge about $13 a month for access to
more than 100 channels; an online music content provider gets about
$15 in the same period for unlimited downloads to a computer, or
digital music player. Apple's iTunes music library charges about 99
cents per song.

"It's just another way to offer entertainment on the cell phone," said
Albert Lin, an analyst with American Technology Research.

In a recent research note, he called providing preselected audio
content for cell phones "a massive market opportunity."

Several companies are already betting on the potential, boosted by the
popularity of a multitude of cell phones that enable music downloads.

Clear Channel Communications Inc. the top U.S. radio operator,
earlier this week said it plans to begin offering clips of programs
over handsets by the end of 2005.

Outside of the United States, operators like Virgin Radio in Britain
and Swedish broadcaster SBS Broadcasting System SA are creating
interactive radio to deliver to users.

COMPLEMENT TO iTUNES?

Motorola has already seen the value in delivering music
content. Through a partnership with Apple, it will soon launch a cell
phone that works with the Apple iTunes service.

But iRadio requires a substantial up-front investment. A customer
will initially lay out about $200 for a mid-range Motorola phone
with at least 256 megabytes of storage, built in iRadio software and
Bluetooth, a low-range wireless technology that streams content from
the phone to the car radio or home stereo, Ulmer said.

The service
also requires buying a $75 wireless audio adapter that must be
installed in the car radio, either by the customer or a service
provider. A USB connector to hook the phone to the desktop computer
comes packaged with the handset.

Ulmer said Motorola plans to test the service in several U.S. markets
in mid-May and launch nationwide in the fourth quarter. The company is
also in discussions with several music content and wireless service
providers, he said, but he would not provide specifics.

Motorola will begin selling the iRadio service at retailers, but it is
also in talks with auto companies, who may eventually install iRadio
in luxury cars, similar to arrangements that satellite radio providers
have, Ulmer said.

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